A state judge in Austin, Texas ruled Monday that State Insurance Commissioner Mike Geeslin was within his authority when he ordered
Texas State District Judge Tim Sulak ruled after hearing two hours of arguments from attorneys for the state insurance department, the Office of Public Insurance Counsel and State Farm, according to The Dallas Morning News. "There is substantial evidence to support the commissioner's decision, and the decision is upheld," Sulak declared.
State Farm spokesman Kevin Davis told The Beaumont Enterprise that the company plans to appeal Sulak's decision. "We believe our rates are fair and competitive," he told the newspaper.
Geeslin issued the order in November 2009 in what was then a 6-year-old case in which regulators ordered the company to cut its rates 12%. Public Insurance Counsel Deeia Beck, who represents consumers, has argued that State Farm should refund almost $1 billion, according to the Dallas newspaper.
State Farm, however, contends it owes nothing.
State Farm writes more homeowners policies in Texas than any other company, having 28.8% of market share there. The next biggest is Allstate with 9.2%, Jerry Hagins, a Texas Department of Insurance spokesman, told the Beaumont newspaper.
The conflict began in 2003 when the state legislature authorized the insurance department to regulate rates. Following this action, the commissioner ordered 32 insurers to cut their rates, and all but State Farm have complied, Hagins told The Enterprise.
Information from the Houston Chronicle was included in this article.
